Sen. Sessions accuses China of currency manipulation. What does that mean?

The Mobile Area Chamber of Commerce hosted U.S. Senator Jeff Sessions during a Forum Alabama breakfast Monday April 30, at the Renaissance Mobile Riverview Plaza Hotel in downtown Mobile, Ala. The senator discussed a variety of national issues including transportation, reauthorization, national defense and more. Sessions, center, speaks with BAE Systems officials Victor Rhoades, left, and Walter Meigs, obscured behind Sessions. BAE Systems was the corporate sponsor of the event. (Press-Register/Mike Kittrell)

U.S. Sen. Jeff Sessions, R-AL, is stepping up his rhetoric toward the Chinese government regarding the value of that nation's currency.

“American manufacturers and American workers are suffering from currency manipulation that unfairly impacts their ability to compete," Sessions said in a statement issued Thursday.

To respond to that manipulation, Sessions has joined a bipartisan group of senators to introduce the Currency Exchange Rate Oversight Reform Act, which he says is a duplicate version of legislation that the Senate voted to approve in 2011.

"When another country undervalues its currency its manufacturers and exporters gain a significant trade advantage," Sessions said Thursday. "Over time this manipulation has done serious damage to our economy."

The issue is not a new one. The U.S. has made claims about China's currency being artificially low several times over the past few years, says Andreas Rauterkus, an assistant finance professor at the University of Alabama at Birmingham.

"The issue with China is that its currency exchange rate is not free floating, but effectively pegged against the U.S. dollar, which means it does not change with respect to the dollar," Rauterkus explains. "Given that the U.S. is China's largest trade partner, that makes perfect sense for them, because it eliminates exchange rate risk."

"A stronger currency would make Chinese exports to the U.S. more expensive and U.S. imports to China cheaper," he adds. "Since China relies on the U.S. market they are reluctant to appreciate the value of their currency."

Will anything come of the Senate's latest move? Because the countries rely on each other so intensely -- China holds more than $1 trillion worth of U.S. debt -- Rauterkus warns that there might not be much change.

"Both countries need each other and can ill afford any kind of trade war," Rauterkus says.